Capturing the consumer pulse of the smart grid

Capturing the consumer pulse of the smart grid

The popular adage says: Different strokes for different folks. This expression speaks volumes in reference to understanding consumers views and favorability toward smart energy programs and technologies. The Smart Grid Consumer Collaborative (SGCC) recently commissioned a survey on this topic and found that consumer engagement is a key driver for the success of energy efficiency, demand response, adoption of smart energy technologies and other programs offered by many utilities. Yet, many utilities struggle with effectively engaging consumers. The key to effective engagement lies in understanding consumers attitudes and motivations and in understanding that consumers are not monolithic.

Last week, SGCC released the Consumer Pulse Wave 5 and Market Segmentation study. The report provides in-depth insight into U.S. consumers awareness, favorability, expectations and preferences as they relate to the smart grid. First conducted in 2011, the report is the fifth wave of a national telephone survey of residential consumers. Each wave of the study interviewed 1,000 adult (18+) heads of household via phone. The data was weighted by age, ethnicity, gender and region to align with national population parameters.

With the annual Consumer Pulse study, we set out to answer two important questions:

1. What do consumers know and what do they care about?

2. What smart energy benefits do U.S. consumers embrace and find most important? What did we discover?

The analysis revealed that consumers embrace the benefits of new smart energy technologies and many are interested in new pricing plans and service options that utilities are starting to offer. The survey tested three major benefits of smart energy technology: improved reliability, reduced greenhouse gas emissions and helping consumers save money by enabling better energy management. In each case, at least 86 percent of consumers feel these smart grid benefits are important.

The survey results also illustrated that there is high consumer interest in electric utility energy programs. For example, three out of five respondents stated that they would likely participate in a critical peak rebate program. Additionally, one-fourth to almost half of consumers interviewed in the survey say they would be likely to participate in three other pricing programs time-of-use, demand response and critical peak pricing plans that were tested in the survey. Consumers favor smart energy programs that offer simplicity and convenience and put customers, rather than utilities, in charge of household energy management. These types of energy programs have broad appeal and offer an opportunity for utilities to increase customer engagement and improve customer satisfaction.

Although penetration of households with smart meters has continued to grow since the first wave of Consumer Pulse research in 2011, consumer awareness of the terms smart grid and smart meter remains unchanged. Approximately half of consumers say they have never heard of either term, and nearly 23 percent have heard of the terms but do not know what they mean. After three years and five waves of tracking, the key question may no longer be how much knowledge and favorability of the terms smart grid and smart meter improved. Instead, the objective should be to measure the adoption of, and interest in, products and services that are delivered through smart grid technology.

While the vast majority of consumers never heard of the terms, of the 25 percent who have, we found a small but statistically significant increase in unfavorability toward both smart grid and smart meters. In order to deepen the broad consumer appeal of smart grid benefits and shape a meaningful relationship with consumers, utilities and smart grid stakeholders must improve communications through robust and innovative education and engagement practices.